In reply to critics, agency proposes more transparency for well-fracking requests

In an apparent bow to critics and to increase transparency in state government decisions, the state's oil-well regulator on Wednesday proposed notifying the public and accepting comments on applications for hydraulic fracturing operations.

The Alaska Oil and Gas Conservation Commission currently does not issue public notices or hold hearings when an operator applies for a permit to drill a well and frack it to increase oil and gas production. Fracking is controversial in the Lower 48, where critics have charged it has led to contamination of well water, but officials in Alaska say it has been done here safely for years.

Information about fracking requests is currently made available to the general public after the agency approves the operation, although land owners within a half-mile radius of a planned well-bore must be notified by companies and can request an application.

The proposed change follows a letter in September by conservation group Cook Inletkeeper that urged the agency to change its rules to require public notice, hearings and comment periods before applications for fracking can be approved, a request that remains under consideration.

Hydraulic fracturing, or fracking, generated relatively little attention in Alaska until recently, although the agency in 2014 strengthened its fracking regulations after hearing from the public. The changes followed concerns raised in the Lower 48 about potential threats to clean water, wildlife and the earthquakes such activity might cause.

Experts say operators have safely conducted fracking operations in Cook Inlet and the North Slope for decades, without reports of harm to the environment.

But plans by Texas oil company BlueCrest Energy to hydraulically fracture a well north of Anchor Point have stirred concerns on the Kenai Peninsula. The company plans to employ hydraulic fracturing deep beneath the Cook Inlet seafloor about 4 miles off the coast, said Benji Johnson, chief executive of BlueCrest.

The fracking should start in about two months, he said earlier this month. After about two months of drilling, the well now extends 3 miles off the coast.

Precautions include three layers of pipe surrounded by cement to protect groundwater, preventing fluids that would travel in the inner pipe from escaping.

"The surface groundwater is extremely well protected," he said.

On Dec. 15, the commission held a tense hearing on Cook Inletkeeper's request, with AOGCC chair Cathy Foerster using an expletive during testimony as she defended her agency's work.

A key concern cited by industry representatives was costly delays to drilling operations that comment periods and hearings could pose. The proposal encourages more disclosure while keeping drilling budgets in mind.

The proposal from the three-member commission calls for posting applications for wells involving hydraulic-fracturing operations on its website, and accepting public comments for 10 days. Companies looking to drill can redact confidential information. The proposal does not define confidential.

Foerster said on Thursday that the commission suggested its own rule change after considering comments from the December meeting. She said she could not provide further comment while the issue remains "under adjudication."

Bob Shavelson, executive director of Cook Inletkeeper, said Alaska's rules for hydraulic fracturing are generally better for the environment than in other states. But he said he has concerns about the new proposal, including that 10 days is a relatively short comment period. More specifics are also needed, such as clarifying that comments will be accepted before applications are approved.

"This proposal is so fluffy and nonspecific it suggests there's not a serious desire to address the public's concerns," he said.

Johnson, of BlueCrest, said the proposal offers a "reasonable" solution that won't cause big delays in the oil patch. He said information that could be redacted would include proprietary data competitors may want. But he believes fracking fluids must be disclosed.

"The information about fracking is already public because it's given to nearby residents anyway, so we have no problem with it being posted on (a) website," he said.

The agency began accepting public comments on the new proposal on Wednesday. It has set a second public hearing on March 23 to take input on both proposals.

Kara Moriarty, president of the Alaska Oil and Gas Association, said the industry advocacy group is reviewing the new proposal. But she asserted that Alaska already has the "most stringent" fracking rules in the United States, and that any additional delays will discourage investment in oil and gas activity.